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Energy Efficiency

To meet our nation’s economic and environmental goals, America needs a comprehensive energy policy that promotes energy efficiency in the industrial, commercial and residential sectors, including adoption of strong energy efficiency building codes and more efficient generation of industrial energy, such as “combined heat and power.”

Policy Background

Since 40 percent of energy in the United States is used in buildings and 31 percent is used in industry, improved energy efficiency technologies in the industrial, commercial and residential sectors will lead to significant energy savings.

Building Codes

In the United States, individual states have primary responsibility for adopting codes that encourage more energy efficient buildings. By adopting, implementing and enforcing the latest International Energy Conservation Code and passing laws that automatically adopt updated codes, states can dramatically reduce energy use and realize the economic and environmental benefits.

Updated building codes would increase use of the products of chemistry—plastic foam insulation, solar panels, house wrap, compact fluorescent lights—and boost energy savings, help create green jobs and propel U.S. economic growth. Increased use of the products of chemistry also would reduce greenhouse gases—a groundbreaking study in 2009 by McKinsey & Company found that products of chemistry save twice the greenhouse gas emissions than are emitted making the products.

Combined Heat and Power

Chemical makers and many other manufacturers use natural gas to create two forms of energy—steam and electricity—for industrial facilities. Known as “combined heat and power” (CHP), this energy is generated close to where it is needed, so little is lost in transmission. CHP can produce energy twice as efficiently as older coal-burning electric utilities.

Expansion of CHP is supported broadly by business, labor and environmental groups. An Oak Ridge National Laboratory study estimated that the United States can meet 20 percent of its electricity needs from high-efficiency CHP units by 2030.

ACC’s Policy Position

In order to make the most of America’s energy resources and compete with the rest of the world, policymakers must maximize energy efficiency’s contribution to the nation’s energy portfolio. Given federal and state budget realities, however, public policies must look beyond traditional government subsidies and identify new ways to encourage energy efficiency, such as adopting updated energy efficiency building codes and supporting more combined heat and power at industrial facilities.

Federal legislation such as the “Energy Savings and Industrial Competitiveness Act” (S. 1392) would improve energy efficiency in the residential, commercial and industrial sectors. Another federal proposal would recognize the value of energy efficiency in home mortgages.

Current policies allow utilities to effectively block third-party CHP operators from selling surplus power to the electricity grid. Regulators must remove artificial barriers to distributed electricity generation, including industrial CHP.

The U.S. should establish a national goal to double electricity output from combined heat and power and waste heat recovery systems.